Banks' financial innovation and the demand on money. (2nd July 2019)

• Record Type: Journal Article
• Authors: Bashayreh, Ala'; Alomari, Mohammad W.; Abdelhadi, Samer; Mryan, Naderh
• Is Part Of: International journal of monetary economics and finance. Volume 12:Number 3(2019)
• Page Start: 169
• Page End: 179
• Publication Date: 2019-07-02
• Subjects: demand on money -- financial innovation -- commercial banks -- Jordan; Monetary policy -- Periodicals; Finance -- Periodicals; Economics -- Mathematical models -- Periodicals; 332.4
• Languages: English
• ISSNs: 1752-0479

Abstract

Financial innovation has come through improvement over time in financial tools and payment instruments used in the lending and borrowing of funds. This study aims at investigating the effect of electronic money on demand for money in Jordanian economy. The study uses ordinary least square (OLS) regression model to analyse a panel data over the period of (2011-2016), depending on data collecting of 13 commercial banks in Jordan. Results reveal that both GDP growth and the growth of visa cards number of each bank have positive and significant effect on the demand for money. On other hand, money demand was found to be negatively related with growth of interest rate, growth of total credit facilities granted by each bank, technological progress and utility bills paying service.